Pearson LCCI
Wednesday 8 June 2022
Time: 3 hours Paper Reference ASE20104
Certificate in Accounting (VRQ)
Level 3
Resource Booklet
Do not return this Booklet with the question paper.
Instructions
•• AllPlease
workings and answers must be given in the question paper.
note that any workings and answers written in the Resource Booklet will
not be marked.
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*P72069A*
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©2022 Pearson Education Ltd.
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Resource for Question 1 – Part (a).
Ned and Olivia’s partnership agreement provided for a salary of $2 500 for Ned and the
sharing of profits and losses equally.
They have provided the following information in addition to the extended trial balance
extract at 30 April 2022 on page 2 of the question paper.
• A cheque payment, $2 500, for Ned’s salary had been entered in the wages and
salaries account.
• Capital introduced by Olivia, $15 000, had been credited to both the bank account
and her current account.
• Insurance, $225, for the three months ending 31 May 2022 was owing.
• Rent payable included $18 000, which had been paid for the 12 months to
31 August 2022.
• The purchase of computer equipment, $1 900, and printer paper, $20, paid for by Ned
using his private funds had not been entered in the books.
• Depreciation is charged at 10% per annum on computer equipment using the
straight line method. A full year’s depreciation is charged in the year of purchase and
none in the year of disposal.
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Resource for Question 2 – Part (a).
On 1 May 2021 Nee plc acquired 102 000 ordinary shares in Vodme Ltd.
The directors provided the following information at 30 April 2022.
Nee plc Vodme Ltd
$ $
5% debenture (2022) 20 000 –
Bank 59 300 13 500
Cash 2 500 1 300
Inventory 89 330 67 060
Investment in Vodme Ltd 450 000 –
Property, plant and equipment – cost 739 750 395 100
Property, plant and equipment – provision for depreciation 281 200 143 410
Retained earnings 347 250 180 500
Share capital (ordinary shares of $1 each) 660 000 120 000
Tax payable 67 380 16 450
Trade and other payables 61 740 63 200
Trade and other receivables 96 690 46 600
Profit for the year ending 30 April 2022 for Vodme Ltd was $64 500
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Resource for Question 3 – Parts (a), (b) and (c).
The directors of Wikt Ltd provided the following information in addition to the schedule
of non-current assets at 30 April 2022 on page 8 of the question paper.
On 1 April 2022 a motor vehicle costing $33 000 purchased on 1 January 2019, was sold
at a loss of $4 396
Motor vehicles are depreciated at 20% per annum using the reducing (diminishing)
balance method. A full year’s depreciation is charged in the year of purchase and none in
the year of disposal.
30 April
2021 2022
$ $
Share capital – ordinary shares of $0.50 each 98 000 112 000
Share premium 16 000 21 600
Date Details
1 August 2021 A final dividend of $0.15 per share was paid on all shares in issue at
that date.
1 September 2021 An issue of ordinary shares of $0.50 was made.
1 October 2021 An interim dividend of $0.05 per share was paid on all shares in
issue at that date.
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Resource for Question 4 – Parts (a), (b) and (c).
Delongea Ltd is considering purchasing a new machine that is expected to last five
years, when it will be sold for $38 000. The following information is based on the annual
production and sales of 25 000 units.
Cost of machine 171 000
Installation cost 7 000
Per unit:
Selling price 12.00
Variable cost 8.00
Per year:
Fixed cost (including depreciation) 60 000
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Resource for Question 5 – Parts (b), (c) and (e).
Tom provided the following information together with the cash budget for the
three-month period ending 30 November 2022.
• 75% of sales will be on a credit basis and the remainder will be on a cash basis.
• 40% of credit sales will be received in the month following sale and are allowed a 2%
early settlement discount.
• 60% of credit sales will be received two months after sale.
• All purchases will be on a cash basis.
• Tom will take goods for his own use costing $80 per month.
• At the end of each month there will be a closing inventory of $18 000
• Tom has an agreed overdraft limit with his bank of $10 000
Cash budget for the three-month period ending 30 November 2022
September October November
$ $ $
Receipts
Cash sales 15 000 14 000 13 000
Trade receivables (credit sales) 35 160 35 640 43 464
Total receipts 50 160 49 640 56 464
Payments
Cash purchases 45 680 42 640 39 600
Salaries 3 000 3 000 3 000
Drawings 1 600 1 600 1 600
General expenses 1 900 1 900 1 900
Purchase of motor vehicle 18 000 – –
Motor expenses 250 250 250
Total payments 70 430 49 390 46 350
Net inflow/(outflow) (20 270) 250 10 114
Opening balance 6 180 (14 090) (13 840)
Closing balance (14 090) (13 840) (3 726)
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